Avnet finishes Tech Data UK integration early

The BorgAvnet will have finished its Tech Data UK integration by the start of November.

For those who came in late, Tech Data closed its Avnet TS buyout in February this year, and thought that the scale of both businesses would mean that full integration could take up to 12 months.

However, Belgium, Iberia and Italy are already integrated and France and the UK should be completed by the beginning of November, the company said.

By the end of this calendar year, approximately two thirds of the business will be fully integrated.

That did not mean that the integration had not been complex, and Avnet is still checking with customers and vendors if things went ok.

The $2.6 billion deal gave the distributor a presence in the APAC region and boosted its employee count to 14,000 employees across 40 countries globally.

Tech Data will phase out its Azlan brand by the end of Q1 2018, citing the results of a brand study, which discovered that no one in Europe could recognise Azlan in a line-up.

“Awareness of Azlan’s reputation was only recognised in only a limited number of countries, mainly the UK and a bit in France. It was not consistent, so our study recommended putting Tech Data at the front as a master brand”,  the company said.

 

HPE shifts away from lower margins

HPEHPE has outlined its plans for its full year 2018, indicating that it will shift its focus away from lower margin business and focus more on high margin solutions and services.

HPE’s lower margin business – particularly its tier one server business – has been blamed for hampering growth.

HPE said it expects to record revenue growth of five percent, but this prediction takes the tier one business out of the equation.

For its full year 2018, HPE said it expects to report “modest” revenue growth, again discounting the troubled tier-one server business.

Speaking at an analysts meeting, HPE CEO Meg Whitman outlined the five-year turnaround plan HPE is in the middle off, insisting that splitting the company into HPE and HP Inc was the right decision.

“I can tell you without a doubt separating the company in two was absolutely the right thing to do for our customers, our partners, our employees and of course our investors. We’ve seen that in the financial markets reactions.

“In 2012 we embarked on a five-year journey to turn this company around and create better value for shareholders, customers and partners.

“The first step was to diagnose the problems and build a solid foundation for a turnaround. 2013 was all about fixing and rebuilding the business. We improved operations, drove better cash flow and repaired our balance sheet

“In FY14 we focused on recover and expansion. We stabilised our revenue trajectory, we reignited innovation across HP and further strengthened our leadership in key areas. Fy15 was about accelerating that progress. We continued to target investments in higher-margin areas and saw the opportunity to accelerate our business in key acquisitions like Aruba.”

Whitman said that HPE is in the process of strengthening through four key factors: Organic investment, in areas such as HPE Synergy; investment in partnerships; acquisitions of the likes of Nimble and SimpliVity; and portfolio optimisation, which saw its services and software business spun out into separate organisations.

“Our partner ecosystem is the best in the industry and absolutely critical to our future. Partnerships our going to be critical and that’s why we launched Pathfinder, our venture investment and partnership programme. We use our expertise to identify the best emerging start-ups and then we curate their innovation within our innovation which helps us deliver cutting-edge solutions to our customers with results they cannot find anywhere else.”

Misco in shock collapse

il_570xN.386643874_phvgMisco’s shock collapse after nearly 30 years has left the industry shocked.

A few years ago Misco had revenues north of £300 million operating profits of over £10 million and over 600 staff. It was still growing when it opened new offices in Weybridge in 2013.

However, four years later, the Misco UK name abruptly vanished from view and a last-minute rescue attempt to keep the business afloat in a reduced form fell through.

Its collapse comes seven months after a new management team, backed by Hilco Capital, bought the UK and European business from long-time parent Systemax.

But the rot had set in before the new team led by Alan Cantwell arrived and it was probably too late to fix what appears to have been management problems.  Especially as its rivals such as Computacenter appear to be doing well.

Its rivals appear to be thinking that the spiralling death of  Misco was an isolated case for the channel.

Misco UK’s operating losses widened to over £8 million in the year before the change in ownership. Systemax simply gave up and sold it. The feeling is that broadline, commodity distribution was dying, no one is making money from it and Misco was tried to reform too late.

Credit insurers began cutting their exposure to Misco and distributors became unwilling to deal with the reseller, with just a few supporting the business until recently.

Misco also received a winding-up petition from HMRC over unpaid VAT, leaving it with no “viable option other than to seek the protection of administration”.

Channel needs greater diversity

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The IT channel needs to do more to attract women and ethnic minorities.

Industry group CompTIA has been a strong advocate of increasing diversity in the IT industry, having identified a ‘confidence gap’ that has prevented some people from entering the industry and is determined to overcome those problems.

CompTIA CEO Todd Thibodeaux said: “There are lots of people who don’t realise they can work in the industry because they think they need to have a college degree or be maths and science whizzes but it is a different job to the one they think it is. We have to get them over this confidence gap.”

People need to realise that anybody can be trained and acquire the skills to work in the industry but they need to believe they can do it.

He said everyone wanted to speed up the movement towards greater diversity but it was “not something that can be fixed overnight”.

“It will be interesting to see every year from now because that is when we are supposed to see the mass retirement of the early baby boomers that are going to come out of the industry. That is where there will be lots of opportunity”, he said.

Research showed that more diverse companies developed better products faster, service customers better and had happier employees, Thibodeaux said.

As well as getting a more diverse workforce the other lesson that the industry can learn is around being open minded about what fresh talent can bring to the business.

“We are making people conform to the norms in a company when they come in and not allow them to be comfortable and be themselves and bring what they bring to the culture. We are forcing people to come and are forcing them to assimilate to the existing culture, rather than making them feel they can add to the culture.” He added that the drop-out rate can be high.

Progress becomes a hamburger

photo4Security outfit Progress has launched a company in Germany, kickstarted with a Hamburg office and a new German country manager.

Progress was launched last year by John Quinn and is now taking heading into central Europe.

Progress has taken on a dedicated Spanish region manager, based in Madrid, as the firm looks to build its presence in Iberia.

The company said that its European arms will largely be built up of vendors that have a relationship with Progress in the UK, which are looking to move quickly into other European territories.

The normal process for Vendors is to start in the UK, move to the Nordics and the central Europe but Progress is going straight to Central Europe from the UK .

This was mostly because most of the company’s vendors wanted to be in central Europe and a couple of them were already there.

After establishing the Hamburg office Progress will head into Munich, as well as into neighbouring Austria and Switzerland.

As-a-service sourcing contracts grow

Forwarders-set-to-see-growthThe value of as-a-service sourcing contracts have reached an all-time high in EMEA, but a drop in traditional sourcing resulted in a weak quarter overall.

Beancounters at Information Services Group (ISG) have added up some numbers and decided that the 3Q17 EMEA ISG Index shows commercial sector outsourcing contracts with an annual contract value (ACV) of £3.5 million.

The index shows that the as-a-service sector continued its upward trajectory, soaring 48 percent, to £892 million as companies continue to seek cloud and digital solutions to improve operating efficiency and develop new growth opportunities.

This boost countered the significant shortfall in traditional sourcing, which slumped 43 per cent, to £1.1 billion which is its lowest point in a decade.

The falloff in traditional sourcing, upon which EMEA depends more than other regions, caused combined ACV to drop 23 percent, to £2 billion due in part to a lack of large contracts in the quarter.

Barry Matthews, partner at ISG, said that despite a disappointing third quarter, the EMEA market year to date is showing modest growth, with record as-a-service contracting not quite able to counter the drop in traditional sourcing activity.

“Macroeconomic events in EMEA – the recent German election and continued uncertainty surrounding Brexit – continue to slow buying decisions. As-a-service spending will continue to grow significantly through next year, as the imperative on businesses to find agile solutions to boost productivity and reduce costs continues,” he said.

The UK, despite a weak third quarter, posted its strongest year-to-date performance in five years. UK ACV, at£2.2 billion was up 15 percent year over year, while the number of contracts rose 13 percent for the same period.

IBM calls in Watson for the IoT

Sherlock-Holmes-and-WatsonThe ever shrinking Biggish Blue wants to use advanced analytics  and its Watson platform to help partners and customers stand out in the crowded Internet of Things market.

Talking to the assembled throngs at IoTConnex, IBM’s business development leader IoT for Manufacturing and Industrial Products Raghbir Kern said that analytics and cognitive computing capabilities will be an essential part of IoT as industrial companies continue to connect their manufacturing floors.

“You may have heard of Industries 4.0 … this is a concept that focuses on the digitization of the modern manufacturing plant, which means you are connecting all your equipment, data, sensors. … We are taking that and adding on one more layer, cognitive computing, and really delivering on a vision of cognitive manufacturing that our customers have,” said Kern.

Customers were collecting data from multiple sources and are making that data transparent so they can see patterns and trends in the data and deliver better insight.

Kern said that companies will come to rely on tools like analytics. “In order to get to these later stages of cognitive manufacturing … you really have to take advantage of advanced analytics and cognitive technologies,” she said.

Partners have access to advanced analytics through IBM’s Watson Internet of Things platform, which incorporates both rule-based analytics, enabling customers to see what happens when one event occurs, or model-based analytics, which allows customers to predict future events.

With these tools, IBM Watson delivers three core cognitive manufacturing applications: using IoT to sense and diagnose issues so companies can optimise the performance of intelligent assets and equipment; using cognitive processes to bring more certainty to businesses through analysing a variety of information from workflows; and using insight to optimise resources.

HP is making inroads into 3D printing

o-OFFICE-3D-PRINTER-facebookA while back HP promised that it would take the lead in 3D printing and it is starting to look like it is making good on that promise.

Vendor snuck into fifth place in industrial 3D printer market in Q2, four years after Meg Whitman declared that HP intended to lead the market. To be fair though HP has only had products in the 3D printer market for a year and to get to the top five from no-where is some feat.

With its Jet Fusion line up, HP sold $13.5 million of industrial 3D printer hardware in the second quarter of 2017.

According to beancounters at Context HP took a four percent share of the industrial segment of the market in Q2, behind names that will be less familiar to the channel, namely market leader Stratasys, EOS, GE Additive and 3D Systems.

HP began “pushing strongly” into the channel in the first half of the year, “setting itself up for further growth later this year and beyond”, Context said.

The industrial sub-segment Jet Fusion plays in has experienced mixed fortunes since then, with unit shipments declining in both 2015 and 2016.

Context predicts that the industrial sector will return to growth in 2017, partly thanks to the fresh blood that has entered the market.

Polymer machines continued to dominate the market in Q2, accounting for 90 per cent of the unit volume sales and 61 percent of the printer revenues, Context said.

While HP’s machines are initially focused on polymers, GE Additive – which is another new entrant to the top five – focuses on metal 3D printing.

Context vice president of global analysis Chris Connery said that there was a four per cent decline in the number of industrial/professional 3D printers shipped in the second quarter of this year compared to the earlier year, but the average selling price of these machines continued to climb.

“It now seems that both these trends will change in the second half of 2017. Average selling prices are set to drop with the shipment of new category of lower priced metal-printing machines helping to promote new growth.

“For polymer 3D printing, growth is expected from select technologies as this side of the market continues to penetrate into the manufacturing market and away from just prototyping.”

 

 

Softcat makes £800 million

cat-at-laptop-275Even while it hunts for a new CEO Softcat is making piles of dosh.

Softcat’s shares were up in early trading this morning as it announced that sales were up by nearly a quarter in its first full year of trading as a public company.

Revenues for the 12 months ended 31 July 2017 rose by 24 percent to £832.5 million, which the Marlow-based reseller thanks to winning 800 new customers and selling more to

Adjusted operating profit grew by 10.1 percent to hit £51.5 million.

Softcat CEO Martin Hellawell announced this summer that he is to step back into the non-executive chairman role, and in this morning’s stock exchange announcement, the firm said its hunt for a new CEO “is progressing”.

Chess aims to take another acquisition piece

315801_a5e44c0e6f53654feec6d94e671b9cf8_largeVAR outfit Chess is take another cybersecurity piece after acquiring Foursys a few months ago.

Foursys, which will become Chess Cybersecurity, put Chess into the cybersecurity game – most of its acquisitions have been outside that area such as Lanway, Parachute IT and Compwise Systems.

Now the word on the street is that Chess is looking to make another acquisition in the security space. Most of this was due to the Foursys deal paying off so well.

It is not clear who Chess is looking at, or when the deal will be announced, but the plan seems to be to broaden Chess’ cybersecurity space offering.

Apparently there are plenty of companies for sale and because of the increased  interest in cybersecurity there have been a number coming to the market.

Chess, COO Steve Cox is leaving the VAR to take on the role of VP of customer success at insurance software firm Vertafore, a switch which will see him move to Denver. Cox joined Chess last year and was instrumental in setting up the firms ICT division.

 

NetSuite wants more ISVs

photoNetSuite has said that it wants to work with more ISVs and is continuing to recruit more UK partners.

The Oracle-owned outfit is a more attractive prospect for channel players looking to sell more business intelligence tools and services.

NetSuite is recruiting resellers across EMEA as well as bringing on board a larger number of ISVs.

It will be expanding its SuiteCloud Developer Network (SDN) programme to extend the programme across more countries in EMEA  before becoming a global initiative.

The vendor makes SuiteApps which are add-ons for developers to target verticals or compliance requirements in individual countries.

ISVs themselves can also contribute their own apps to help support expansion into specific market areas.

Alongside that initiative the firm has also reported that it is continuing to add new partners in the UK to help service customer demand for ERP solutions.

Ernst & Young fined £1.8 million for Tech Data cock-up

watchdogErnst & Young has been fined £1.8 million by the Financial Reporting Council (FRC)  watch dog after admitting to misconduct surrounding the Tech Data reports.

In 2013 Tech Data was forced to restate numbers for its 2011, 2012, and 2013 fiscal years in the UK after finding accounting “improprieties”.

A 10-month investigation led to the distributor slashing $27 million from its previously reported net profits and triggered a management reshuffle.

The outfit’s auditors Ernst & Young has now been fined by the FRC after its conduct “fell significantly short of the standards” expected of it.

EY’s senior statutory auditor Julian Gray was also fined £59,000.

In a statement the FRC said: “The admitted acts of misconduct related to three audit areas, and included failures to obtain reasonable assurance about whether the financial statements as a whole were free from material misstatement, failures to obtain sufficient appropriate audit evidence and failures to exercise sufficient professional scepticism.”

Ernst & Young was initially fined £2.75 million, but saw a reduction for agreeing to a settlement. Gray’s fine was initially £90,000, but was reduced for the same reason.

EY also paid £225,000 in legal fees.

Kenna Security wants Crompton to spruce up its channel

trevorcromptonCybersecurity outfit Kenna Security has hired Trevor Crompton to build it a shiny new channel of UK sales partners.

Crompton has history with Symantec and RiskIQ.  In RiskIQ he managed to keep 60 resellers, 20 consultants and 10 systems integrators across EMEA happy. Crompton used Obscure Technologies in Africa and Ignition Technologies in the UK.

Crompton has promised the Kenna channel will be 100 percent channel across EMEA. At RiskIQ Crompton he redirected all direct business through resellers.

Market analyst Gartner expects security spending to grow from $28.7 billion across EMEA now to $36.9 billion by 2021. The EU General Data Protection Regulation (GDPR) will drive 65 percent of those buying decisions as companies desperately try to plug data leaks.

Right now, most security bosses don’t know where to start to defend their businesses and Kenna’s partners can solve this problem by managing the risk. Its system reads vulnerability data, compares it to exploit data and calculates the risk score before create a fix priority list.

 

Cloud will see double digit growth this year – claim

grandpa_simpson_yelling_at_cloudThe crack team of divination experts at Gartner Group are predicting that cloud services will see double digit growth this year thanks to strong SaaS and IaaS sales.

By the end of the year, cloud services revenue is predicted to reach $260 billion which is an 18.5 percent year-on-year increase.

The highest growth will come from IaaS offerings, which are projected to grow 36.6 percent in 2017 to reach $34.7 billion and SaaS revenue will grow 21 percent in 2017, to hit $58.6 billion.

Research director at Gartner Sid Nag said that the acceleration in SaaS adoption can be explained by providers delivering nearly all strains of application functional extensions and add-ons as a service. Pretty thrilling, eh?

“This appeals to users because SaaS solutions are engineered to be more purpose-built and are delivering better business outcomes than traditional software. SaaS is also growing faster in 2017 than previously forecast, leading to a significant uplift in the entire public cloud revenue forecast”, he said.

He added that strategic adoption of PaaS offerings are also outperforming previous expectations, as large enterprises are becoming confident that PaaS will be their primary form of application development platform in the future.

“This accounts for the remainder of the increase in this iteration of Gartner’s public cloud services revenue forecast.”

Gartner predicts that the total market will be worth $411.4 billion by 2020. That’s a lotta dosh and very thrilling!

 

It is not all about the cloud, claims NEC

56f884651f7b35416b9b4ca955d350b3--pom-pom-mobile-cloud-mobileNiman’s resellers were told that the world still needed hardware and to stop obessing about the cloud.

NEC sales director Andrew Cooper told the assembled throngs at an NEC communications platform launch gig that while digital transformation was underway the world still needs lots of gray boxes with flashing lights.

Copper said: “A digital transformation is under way but we should all take our head out of the cloud and keep our feet firmly on the ground. Profit is still the most important driver in business.”

He was showing off the SL2100 system, but found the hardware versus cloud debate was getting out of hand

“Without [profit] you don’t exist. It’s about what tangible business benefits can be delivered rather than the method of delivery. The way we consume technology is changing and NEC remains at the forefront,” the Cooper told the assembled throng.

Cooper said according to industry analyst MZA, an estimated 88 percent of the UK’s sub-100 extensions are premises-based. He said that there was still plenty of life in traditional comms-based platforms. Its demise has been greatly exaggerated and it remains the dominant force. Maybe Andrew Cooper should talk to Amazon and develop a habit called ‘being thrilled’.